Sanders accused Acosta of "placing his hands on a young woman just trying to do her job as a White House intern" and of preventing other reporters from asking questions at the news conference.
Among the issues that reporters brought up, Acosta asked for a comment on the refugee caravan heading for the U.S. -Mexico border.
As the hour-long Q and A trundled on, at one point Trump yelled at reporters to "sit down" and regularly barked down reporters with phrases like: "Excuse me, you were not called on".
That's when the staffer attempted to take Acosta's microphone away, and Acosta said "pardon me, ma'am", while he continued to try to ask his question.
"Secretary Sanders lied", CNN said in a statement, saying the press pass suspension was "done in retaliation for challenging questions". Later, via Twitter, she said that she has interviewed white nationalists who say they are more excited by Trump than they have been about other presidents. The news outlet said Acosta had the network's full support.
But as Acosta pressed on and Alexander stood there, Trump turned back to the CNN reporter.
The Trump administration barred another CNN reporter from attending an open media event in July but until now has not gone as far as removing a credential, known as a "hard pass", which enables journalists to enter the White House grounds. "Revoking access to the White House complex is a reaction out of line to the purported offense and is unacceptable".
Acosta has always been a bitter adversary of the White House. "We will not tolerate the inappropriate behavior clearly documented in this video".
Trump made several references in his news conference to how he feels mistreated by the press. "They weren't actors. They didn't come from Hollywood".
Acosta tried to interrupt, saying Trump was being unfair. "That is not an invasion".
'I think you should let me run the country and you run CNN, ' he snapped. "It's so sad", Trump said.
Beloved by some, his fans reportedly leave bourbon in his mailbox and he's often recognised in the street by supporters who thank him for standing up to President Trump.
NBC, in particular, took some heat for their coverage of the altercation, with many conservatives wondering if Acosta should have put his hands on the staffer as she tried to take the microphone back.
Mr Trump took the rare step of mocking Republican candidates who kept their distance from him during the campaign because of concerns that his divisive messages on immigration would turn off voters - but lost anyway.